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Part 1. Overview

1. Development and technology in post-war Japan
2. The Japanese experience: The problems and attempted solutions
3. Theoretical summary: A preliminary examination and an interim conclusion

1. Development and technology in post-war Japan

Japan in the world
Economy and technology in post-war Japan
Post-war recovery
From recovery to rapid growth
Technology transfer in post-war Japan

Japan in the world

Japan's share in the total GNP of the world was 9.0 per cent in 1980, a position exceeded only by the United States and the Soviet Union.

Because at the beginning of the twentieth century Japan accounted for a mere 1 per cent of the world's total GNP, compared with 30 per cent for the United States and 20 per cent for the United Kingdom, this rapid structural change, and the Soviet Union's rise to second position, are remarkable. The changes in the scope and the structure of the world economy are readily apparent in the 1980 shares of world GNP held by the United States and the United Kingdom, 21.9 per cent and 3.6 per cent, respectively.

In terms of per capita GNP, Japan has achieved a level comparable to that of both the United States and the United Kingdom, inasmuch as its population is slightly more than half that of the United States and slightly less than that of the United Kingdom. In other words, over the past 80 years, the Japanese economy has grown 30 times as fast as the US economy and 20 times as fast as the UK economy. However, this is merely a matter of flows; in stocks, it should be noted, unfavorable gaps remain for Japan compared with either the US or the UK, the latter especially.

With regard to the power of a nation to influence the international community, the United States and the United Kingdom are in a far better position than other nations because English is a nearly universal language. The Japanese language, on the other hand, is not even treated as an official UN language. Thus, when it comes to the question of a country's international political influence, its economic power is not always the decisive factor; this is obvious in the examples of China and India.

Taking population as a criterion, a country with a population of more than 100 million may be regarded as big, but Japan has barely enough population to enable it to count itself among the big countries. Even the United States and the Soviet Union are far smaller in this regard than China and India.

A country with less than US$10,000 per capita national income and less than 100 million population may not be expected to make effective use of a full set of modern technologies because it cannot realize economic efficiency at a level these technologies would require.

Judged, then, in different aspects, Japan may fall outside the group of front runners, but it may be inappropriate to place it among the second-group runners considering the great distance between the two groups. Seen in terms of its industrial power and its governmental system, Japan is Western, but culturally it remains Asian.

Beginning in the 1960s and continuing for more than a decade, the Japanese economy was able to achieve what was then called a miraculous annual growth rate exceeding 10 per cent. Though this was in many ways ascribable to the previous low level of its economic development and to the nation's recovery from World War II, it also reflected the rapid expansion of the scope of production through technology transfer.

Worth noting here is the difference between Japan and the other industrial countries in how it coped with the oil crises of the 1970s, an epochal situation in contemporary history that threw most of the world into hard times. Whereas most countries viewed the crises as a stoppage of the oil supply, Japan saw them as signs of the need to rationalize through technological innovation.

When the economies of the industrially advanced nations were confronted by stagflation, and the United States, which had led the post-war world, suffered a growth rate that had declined to as low as 3.5 per cent (the EC countries had an average of 3.1 per cent), Japan managed to maintain a growth rate not lower than 5 per cent. By the end of the 1970s, much to the perplexity of the Japanese, the world looked to Japan and West Germany to play the role of locomotive, to pull the world economy out of its recession.

It is beyond my ability to fully answer the question of how Japan managed to surmount the crises of the 1970s. One answer that has been offered relates the Japanese success to its capacity for technological innovation, and without doubt, technology has contributed much to the high economic growth rates of Japan since the mid-1960s, a ratio of contribution calculated at 30 per cent. Just as it managed to tide over the oil crises that had brought the high-growth period to an end, Japan also managed to overcome the difficulties caused by industrial pollution that emerged in the 1960s and 1970s by developing technologies to control or prevent pollution and others to conserve energy. These accomplishments brought world recognition to Japan as a technologically advanced country.

Is Japan the front runner of the developing countries, or is it running on the heels of the developed countries? It may be that it has elements of both. In some technologies, though, it is without doubt a leader.1

From the time we undertook this project, and especially since 1980, an unusually keen world-wide interest has centered on technology. It seems that the second oil crisis, in 1979, and the ensuing economic difficulties compelled many countries to seek technological innovation as a way to change the status quo.

Something that made it less difficult for Japan than other industrial nations to cope with the oil crises was that industry largely accounted for Japanese oil consumption, thus relegating that portion used by individuals to a less important position than in other countries. This made it easier to develop energy-saving technologies and possibly easier to implement them with more resounding effects. Yet no one can say for certain that technology will be able at all times to play the lead role as a problem solver, as perhaps it has until now.

Indeed, technology alone has not the power to solve economic and related problems. Managerial skills are absolutely vital, as the Japanese experience shows; at the same time, Japan's strategy must be acknowledged as a general solution and not one that is peculiarly Japanese. Thus, it could be said that the Japanese solution is merely one form of the general solution. There have been some studies that pursue this perspective, but we need to examine the question further before coming to any conclusions.

Although technology is not all that counts, its importance is undeniable. In this context, it is not surprising that Japanese technology, with its peculiar history of formation and its unique structure, should have aroused interest among other nations. It is with this in mind that we decided to study the problem.

Our conception of technology and development may differ from the usual. While science is universal, technology is not. What may be called the internal and external links of technology cannot be broken when innovation occurs. In other words, although the internal logic or built-in mechanism of a technology is autonomic, the external conditions under which it must operate are not. Herein lies the dilemma of technology.

Economy and technology in post-war Japan

With the world's mining and manufacturing production index for 1975-the year after the oil crisis hit-given as 100, the corresponding figure for Japan in 1980 was 124. By 1980, the economies of all the industrialized countries except Japan stagnated, and the index for the United Kingdom fell below even the 1975 level.

The first to recover from this crisis was Japan, its corresponding index scoring 142 in 1981, followed by the United States (128), France, and West Germany. In terms of per capita GDP in 1980, ignoring the oil-producing countries of the Middle East with figures as high as US$30,000, the Japanese figure, at US$9,890, was 61.8 per cent of the Swiss figure and 89.9 per cent of the US figure. This placed Japan seventeenth among all countries (though fifteenth in 1975). Japan has the smallest personal income gap between rich and poor.

To give a fuller picture, we must consider that Japan depends on imports for 95 per cent of its energy consumption, for 90 per cent of the important raw materials for its manufacturing and mining industries, and for more than 60 per cent of its food requirements. It must be said, therefore, that Japan, though often called an economic superpower, is a vulnerable power-even a minor power in respect to natural resources-a nation that has no other choice but to keep itself going on the basis of technology and foreign trade. Despite the high economic figures for Japan in terms of flows, the livelihood of its people, if not poor, is still far from being rich if seen in terms of stocks. A European Community leader once aptly commented that the average Japanese is "a workaholic who lives in a rabbit hutch."

Even so, the Japanese living standard, not well-to-do but not badly off, is something enviable for people in the third world. The Japanese may live in rabbit hutches, but in the third world even a small dwelling would be satisfactory if clean and sanitary and supplied with tap water and electrical home appliances. For many people in the third world, beset with chronic underemployment or latent unemployment and lacking decent homes, Japan could be a not-so-far-away goal at which to aim. Note too that Japan grew nearly to what it is today in not much more than a quarter-century.

While Japan scored 124 in the mining and manufacturing production index in 1980, the Republic of Korea registered 210. Obviously, the movement of the production index, like that of the growth rate, has no direct bearing on amount in absolute value. The smaller the absolute value of production, the greater the index movement might be, and conversely, the greater the absolute value of production, the smaller the index movement. The continued rapid economic growth of post-war Japan indicates that, because of the great war damage the country suffered, its economic reconstruction had to start from limited, but deliberate, activity and a low level of living.

Post-war recovery

The cities of Hiroshima and Nagasaki were each destroyed by a single atomic bomb. A great many Japanese cities, with the well-known exceptions of Kyoto and Nara, ancient capitals of Japan, suffered from bombing: in the 119 cities bombed, 2.2 million houses (about 20 per cent) were destroyed and 9 million people made homeless. Because few new houses were built during the war, in post-war urban Japan more than one family - sometimes several - would be jammed together into a house that was already past its prime.

The devastation affected everything connected with daily life, from factories, roads, bridges, electric lines, and waterworks to schools, hospitals, and communications systems. About 40 per cent of civilian national wealth was lost, and the few machines and pieces of equipment that survived were overused, poorly maintained, and short of parts and accessories.

For several years after the defeat, the nation's standard of living hovered at a level of 30 per cent of the top pre-war (1935-1937) level; mining and manufacturing production in 1946 stood at a mere 6.6 per cent of the pre-war high. The greatest losses were in shipping: from a total tonnage of 6.3 million, only 1.53 million (or 24 per cent) had survived.

The railroads were more fortunate, with track loss at 50 per cent and rolling stock loss at a mere 10 per cent, and hydroelectric power plants had suffered only slightly. But with 6 million Japanese being repatriated from overseas and with the presence of the Occupation forces, whose requirements had priority over everything else, the capacities of these two sectors, even if fully worked, could not meet the demand.

Before and during the war, Japan had been largely dependent on Korea for its supply of rice, beans, iron-ore, and anthracite; on Taiwan for rice and sugar; on Sakhalin for timber, wood-pulp, and coal; on Manchuria for iron-ore, coal, and soya beans; and on China for salt, iron-ore, and coal. The stoppage of their supplies as a result of the defeat badly affected Japan's mining and manufacturing industries, and the people suffered from a great shortage of daily necessities.

Extremely short in supply were textiles, with production at merely 33 per cent of the pre-war high; ammonium sulfate was at 42 per cent, paper at 46 per cent, and bicycles at 20 per cent. And manufacturing came to a halt after raw materials were exhausted. The shortage of goods went hand in hand with inflationary spirals.

Intending to materially disarm the militarist-fascist state, the Allied victors prepared a plan toward the end of 1945 for "reparations in kind" to be imposed on the defeated nation. This called for removing or dismantling 50 per cent of the machine tools, all manufacturing equipment of the light-metal and ball-bearing industries, 20 shipyards and naval arsenals, and all plants having a capacity to produce more than 2.5 million tons of steel (the total steel-producing capacity of Japan was 11 million tons). More than 1,000 plants were designated for reparations.

Industrial capacity left untouched at the time was meant solely to produce goods for reparations. It was intended that Japan would revert to a small agricultural nation governed by what Westerners then understood as Asiatic standards; it was to be kept at the level at which it had stood immediately after the 1929 slump.

In other words, Japan should never again rise above the levels of the Asian countries it had trampled underfoot by armed aggression. Its annual production of crude steel, for instance, was not to exceed 1.5 million tons, a level at which it had stood 20 years earlier (1926), and its production would rely solely on domestic ores.

The year of defeat happened to coincide with a very bad rice crop, the second worst in this-century, which was further aggravated by typhoons and floods. The rice yield dropped to 60 per cent of an average year, and fears were strong that 10 per cent of the nation's 80 million population might die of starvation. Even through a food rationing system, the Japanese government could not ensure a per-capita daily intake of 1,300 calories.

One observer, an American journalist arriving in Japan at the end of 1945, described the aftermath this way:

The closer we came to Yokohama, the plainer became the gravity of Japan's hurt. Before us, as far as we could see, lay miles of rubble. The people were ragged and distraught.... There were no new buildings in sight. The skeletons of railway cars and locomotives remained untouched on the tracks. Gutted buses and automobiles lay abandoned by the roadside. This was all a man-made desert, ugly and desolate and hazy in the dust that rose from the crushed bricks and mortar.2

One scholar referred to the Gayn descriptions as a record of a situation characterized by "great heaps of useless war equipment laying about, with throngs of people running pell-mell for the few scraps of consumption goods that remained."3

Raw materials could not be imported, and a shortage of fuel greatly hampered transportation. As for electricity, voltage was so low that lamps barely shone. As the currency lost popular confidence, economic life became one based mostly on exchange and barter. A state of marginal existence under rampant inflation from an extreme shortage of goods lasted more than three years. The people were in constant lethargy. A judge, believing that "a bad law is still a law," refused to buy food on the "unlawful" black market and died of malnutrition in October 1947.

Priority production system and the dodge line

Despite the economic difficulties, there were some improvements: The Occupation authorities steadily effected measures to demilitarize and democratize the defeated nation. The emperor myth was unveiled, and the forces that had operated under the aegis of the "inviolability of the Imperial prerogative" were politically ostracized. Women were enfranchised and workers given the right to organize. The education system was reformed. The special political police organization was dissolved, and freedom of speech and freedom of the press were assured.

One of the most important reforms was the land reform, which swept away the semi-feudal landlord-tenant relations. In the three years after 1946, a total of 1.87 million hectares, or 81 per cent, of tenant land, and 240,000 hectares of pasture-land were released from landlord ownership. Most tenant farmers became owner-farmers, with the maximum of landownership set at 1 hectare, excluding some provinces and forest land. Land reform was fundamental in expanding and deepening Japan's domestic market.

The House of Peers, whose membership had been restricted to high taxpayers and absentee landlords, was abolished. This collapsed the material foundation of the ultraconservative forces that had been opposed to all reforms on the strength of the "inviolability" of the emperor. There are several reasons that explain the quick and successful execution of the land reform.

First, it was done under orders of the Occupation forces; second, the new farmers' unions throughout the country were a force to prevent landlords from sabotaging the reform; and third, landlord rule over tenant farmers had been on the wane through the war as economic controls such as fertilizer rationing and the rice delivery system were imposed. Also, since the 1910s, when tenancy disputes began to be frequent, the government had posted kosaku-kan (officials in charge of tenancy relations) with police power in all prefectures. The kosaku-kan had kept detailed accounts of the tenancy disputes they had handled, and these records were helpful in reform administration.

During the time of the reforms, the economic life of the nation, aggravated by inflation, showed no signs of improvement. A plan was drawn up to give priority in recovery to the basic industries, namely, steel, coal, fertilizer, gas, cement, and railroads. Under this plan, the "priority production system," labour and money were first to be put into coal-mines; then coal was to be produced for manufacturing iron and steel, and the steel materials were to be used for increasing coal production. It was hoped that in this way allied industries and others would be stimulated and the inflation resulting from the shortage of goods would gradually be overcome.

This recovery plan, though theoretically reasonable, was misguided. To begin with, the existing coal-mines had obsolete, worn equipment whose maintenance had been neglected in the wartime drive for more coal. Skilled miners were in short supply, 20 per cent of the total being inexperienced. Three to five years would be necessary before many of the mines could recover their pre-war levels of output. The annual coal output per miner was only 90 tons, versus the pre-war (1930-1934) average of 200 tons.

Second, although daily-necessity consumer goods were in extremely short supply, the demand for steel and other basic producer's goods was not great enough for their manufacturing capacities to operate profitably or for the labour force to be effectively employable. Hence, their market prices had to be even lower than their production costs. The government, therefore, subsidized these industries to cover the backspread.

Since the steel industry was more capital-intensive than coal-mining, it could recover faster than mining when supplied with imported raw materials and subsidized by the government. The priority production policy thus stimulated recovery in these industries, but it did not eliminate inflation.

Priority was also given to the increased production of ammonium sulfate fertilizer, needed for rice cultivation. As symbolized by the 1946 "Food May Day" demonstrations, the food shortage was an important part of the critical economic conditions and a key factor in the political and social unrest at the time. The government therefore treated the chemical fertilizer sector with special political care, and by 1949 it had recovered its pre-war level of production.

Although the estimated requirement of steel materials for use in coal-mines in 1946 was 98,000 tons, only 80,000 were allotted, of which 25,000 were illegally disposed. Only slightly more than half the required steel, therefore, was put to use in the mines. The Occupation authorities ordered the Japanese government to make available 2 million tons of coal monthly for the people, but the government was hard pressed to raise its target level even to 1.2 million tons. The actual monthly output of coal in November 1945 was only 554,000 tons.

The situation regarding cement was no better. Under the cement distribution system, at least 70 per cent of the requirement was to be made available, but what actually appeared was less than 50 per cent. Workers often blamed management for sabotaging production by concealing and illegally disposing of goods and materials. Struggles of the newly legalized labour unions sometimes even led to worker control of production.

A strong distrust of the management running the mines, in which a vast amount of state funds were invested, clouded their operations. This distrust was clearly evident in the proposal by the British representative on the Allied Council for Japan that the state take control of zaibatsu coal-mines for three years. There were even apprehensions about entrusting to the private sector the nation's post-war rehabilitation. The proposal for state control of the coal-mines was finally abandoned after a frantic resistance by management. And management soon regained control of the mines where production had come under worker control.

By 1949, thanks to the government's emergency aid in addition to the intended effects of the priority production system, industrial production had largely caught up with inflation. Then, however, the Occupation authorities ordered the Japanese government to change its policy: first, economic aid to Japan was discontinued; second, the price-offsetting subsidies were ordered discontinued; third, a balanced finance policy would be taken to cope with inflation; and fourth, Japan was brought back into the international economy by the introduction of a single exchange rate of US$1: Y360.

With this policy change, the coal industry, which had been allowed to operate with an over employment of labour to increase coal output, was now compelled to raise its productivity and therefore to rationalize and mechanize its production system. It was imperative now not merely to produce more but also to realize lower prices through increased productivity. The steel industry and other basic industries, which, with the aid of government subsidies, had been able to buy coal for Y1,000 a ton, were now forced to pay Y3,344 a ton. These high prices formed a bottle-neck that impeded economic reconstruction.

As a part of the mechanization in the coal industry? coal diggers and loaders were imported from the United States with aid funds. But with pit conditions, coal-beds, and other production conditions being much different from those in US coal-mines, they were soon found awkward to handle and left unused. It is easy to see that this early case of technology transfer failed because of the casual handling under foreign aid. But it is important to note that the unusableness of the American machines (even though this pushed up the price of coal) gave impetus to manufacturing the machines domestically. Because the machinery industry had been very much munitions oriented during the war, it found itself in need of new markets in this period; consequently, the coal industry was a welcome customer.

The Japanese coal industry next turned to Europe for the necessary technologies, and in 1950 it introduced the Kappe method of coal-mining from West Germany. By the following year, this technology had begun to be adopted by the leading coal-mines, and, coupled with the successful development of shafts that had been in progress in some of the major coal-mines, it raised productivity. Coal output approached 50 million tons in 1951, and productivity became comparable with the levels of most European countries.

The steel industry began peacetime work with three operating blast-furnaces at the Yawata Ironworks (in its heyday, the industry had had a total of 37 blast-furnaces). The newest of the nation's furnaces (affecting 22 plants, or the equivalent of three-fourths of total capacity) were designated for reparations, most chief executives were purged, and the biggest of the enterprises was dissolved under the economic democratization policy of the Occupation authorities.

The recovery of steel production was slow, but after a mere 560,000 tons in the year of defeat, it recovered four years later to 70 per cent of the pre-war level (or to 4.84 million tons in crude steel). Then came the government's abrupt changes in economic policy and, like the coal industry, steel suffered a serious blow. Although it had succeeded in introducing a technology enabling it to use ordinary coal instead of raw coal, the steel industry could not achieve marketability without the aid of price subsidies.

As we have seen, the government's abrupt policy change dealt a serious blow to the recovering economy. Major corporations were forced to dismiss their employees on a massive scale, and some were even driven to bankruptcy. The government's reduced budget policy came suddenly, at a time when industry had not yet managed to fully recover productivity and when many enterprises were unable to meet market needs because production costs were too high. The new policy, the so-called Dodge Line policy, quickly ended inflation, but it increased uncertainty about the future of the Japanese economy.

The strategy for economic recovery based on coal and steel thus had to be discontinued, and priority was shifted to shipping, electric power, and transportation. Of all branches of the economy, shipping had suffered most, and if Japan were to be brought back into the world economy, the recovery of this sector was urgent.

But a more important reason for a priority shift to shipping was that the Occupation policy, which had designated shipping for reparations of a punitive character, was now beginning to change. As the cold war progressed, the United States, which had played an almost exclusive role in the Occupation, was now increasingly in favour of using Japan and West Germany as factories to help rehabilitate their respective neighboring countries. Also, many US politicians were beginning to feel that if the financial burden on the American taxpayer were to be lessened, the Japanese economy should be made to stand on its own feet.

The Korean War and Japanese Recovery

An unexpected turn of events came with the outbreak of the Korean War in June 1950; it galvanized the Japanese economy back to life. Social reforms that had been dragging amid the chaotic economic conditions began to show progress as the economic life of the nation grew active.

Within the first year of the war, the "special procurements" reached US$340 million; this more than cleared all the backlogs in the manufacturing industries that had been caused by the Dodge Line policy. Goods and materials for use by the UN forces ranged from locomotives, rails, trucks, steel materials, iron posts, electric wire, barbed wire, and other heavy-industry products to chemicals, processed foodstuffs, clothing, and medicines. The procurements reached into all branches of Japanese industry; three branches alone - metals, machinery, and textiles - accounted for 70 per cent of the special procurements.

Covering also the goods and materials for the post-war rehabilitation of South Korea, the special procurements amounted to a total of US$2.4 billion in the four years after 1950, which, even after deducting the cost of imported raw materials, left Japan with a big dollar surplus. The Japanese economy had thus struggled free of its worst difficulties.

The special procurements demanded that Japanese industry mobilize all its existing equipment, however worn and used, so that most of it soon needed replacement or renovation. And this was made possible by foreign currency earnings. Indeed, the first real impetus for Japan's post-war recovery came from the special procurements connected with the Korean War; in other words, the stimulus came from outside Japan.

For example, the steel industry, whose reconstruction based on the priority production system had been stopped by the Dodge Line policy, took advantage of the Korean War to expand its capacity by importing new equipment and realized not only lower prices for its products but also improved quality. What made this possible was the favorable conditions in the international technology market. Technology transfers were very liberal, and Japan's steel industry acted wisely in its choosing and importing of new technology. We will return to this point later in the discussion.

The strip mill is an example of the sort of technology transferred at this time. Compared with older types, it was automated and of far greater speed. Though new to Japan, the technology was already well established in countries with advanced steel industries. Japan had failed to introduce this technology earlier mainly because of the heavy military orientation of the steel industry and because the industry was under state control. The post-war transfer of technology was aimed just as much at the recovery of the steel industry as it was at overtaking the advanced nations.

Another new technology was the basic oxygen steel-making process, also known as the LD process, which was, at the time, the day's newest technology. As an Italian case later reveals, it had not yet been globally established. Nevertheless, the Japanese steel industry adopted and eventually improved the process by adding new ideas and devices, thus laying the foundation for the industry's future development.

Because a strip mill rolls steel in a continuous process at a high speed, mass production became possible. Moreover, the production of high-quality steel sheets had not been possible with the old rolling mills. Thus, Japan was now able to produce materials for use in cars, small electric appliances, and other durable consumer goods, and steel makers could now also mass-produce materials for the general machinery industries. This was all of great significance to the steel industry, which had functioned entirely under the limitations of steel-plates, bar-steel, and section-steel production. Also, with the introduction of LD converters, indispensable for the mass production of rolled-steel products, the two processes of input and output became well balanced. (In most developing countries, they tend to be poorly balanced.)

In another area of the steel sector, a plan for an innovative mill materialized at this time, and the result elevated Japan to a position of world influence among steel makers. Kawasaki Steel Corporation drafted plans for a seaside mill in which the continuous operation of pig-iron production and steel-making was possible. It was a completely new plan both in mill placement and layout. Raw materials (ore and coal) would be unloaded on a wharf at the mill site, undergo manufacturing processes, and emerge as manufactured goods for shipment from another wharf at the same site. At the Yawata Iron Mill - the oldest of Japanese iron and steel works, where a half-century of expansion had meant one new shop or facility after another - the seemingly endless adding-on of the intramill transport railroads extended some 400 kilometres. Plant redesign shortened this by 90 per cent.

Though a change in mill layout may appear to be an insignificant adjustment, when done correctly it can save immense transportation time and fuel costs, which grow in scale as production increases. The result of this amazing foresight soon became status quo as all other steel mills hastened to follow suit.

The idea had been developed during World War II, but the Japanese military had opposed it, and even during the post-war reconstruction, it had failed to materialize. Then came the Korean War, which helped move it from the drawing-board to reality. With the mill's new location and layout, Kawasaki Steel was able to produce 700 tons of steel a day. But there was still some opposition, this time from voices in government circles who felt Kawasaki's transition from a major manufacturer using electric furnaces to one using blast-furnaces might bring on an overproduction of steel. In 1950, Japan's annual output of crude steel had been only 5 million tons.

Overproduction did occur in the 1970s, when the productive capacity for crude steel in Japan reached 110 million tons a year. And a decade later, amid a drop in the world demand for crude steel, Japan's top steel manufacturer, with an annual crude steel production capacity of 50 million tons, had to curtail operations to 60 per cent of capacity.

One of our collaborators in this project, Professor Hoshino Yoshiro, has pointed to several factors that sparked the remarkable growth of the Japanese steel manufacturers, growth that saw the capacity of one soar to 10 times what the immediate post-war output level of all Japan had been.

According to Hoshino, at the time, steel manufacturers throughout the world were competing to enlarge the scope of production, and each country was developing components of technology with little regard for what other countries were doing. Under these circumstances, if a steel manufacturer were observant and could collect data on these various component technologies and integrate them into a single system, he could build the most advanced steel mill in the world. And indeed, Japan at the time was fortunately in a position to fully utilize the advantages of the late comer and ready to spend the time and expense necessary to do this.

This was true not only with steel-making technology but with nearly all other technologies, and here the Japanese experience can serve as an important and useful example. Collecting, examining, and appraising relevant information and bringing it together into a consistent whole should constitute a part of the technological development capability of all the technologically less-developed.

In the third world today, however, several factors make this difficult, if not impossible. These include factors inherent in current technologies and factors relating to the lack or immaturity of external conditions of certain technologies that might enable the less-developed to make use of advanced technologies.

Nevertheless, each developing country must work to overcome these obstacles by setting goals and executing plans based on its particular philosophy of development. Ultimately, development is a matter of national sovereignty.

Post-war Japan had an urgent need to rehabilitate itself, and there was an overwhelming national consensus regarding the indispensability of promoting science and technology through introduction from abroad. There was also the general feeling that Japan's defeat in World War II was due in large part to the antipathy of the Japanese military toward science.

There was a wide range of views, arguments, and counter-arguments in regard to the policies for rehabilitation, especially concerning whether Japan should follow an autarkic line of development or one that would make it an integral part of the world economic system. Throughout, however, a national confidence in science and in democracy prevailed and, indeed, characterized the nation's state of mind in the postwar years before the period of rapid economic growth.

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